Education loan EMI calculator
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An education loan is unusual in two ways that both work in the borrower's favour: prepayment is free, and the interest is typically deductible. It also usually carries a moratorium during study, when interest accrues but no instalment is due — a detail that makes the eventual loan larger than the amount drawn.
What this product looks like
| Typical rate | 8% – 15% |
|---|---|
| Typical term | 1–15 years |
| Maximum loan-to-value | Not applicable |
| Prepayment charge | None |
| Interest usually deductible | Usually |
A worked example
A $250,000 Education loan at a typical 10.5% over 10 years:
| Monthly instalment | $3,373 |
|---|---|
| Total interest | $154,804 |
| Total repaid | $404,804 |
| Income needed | $6,747 |
What to watch
Interest accruing during the moratorium is usually added to the principal, so the loan you start repaying is bigger than the loan you took. Paying the interest during study, if you can, avoids that compounding entirely and is the single highest-value thing a student borrower can do.
Questions
What is the EMI on an education loan?
On $250,000 at a typical 10.5% over 10 years, about $3,373 a month. Repayment usually begins after a moratorium, so your term starts later than the loan does.
Should I pay interest during the course?
If you possibly can. Interest during the moratorium is normally capitalised into the principal, so paying it as it accrues stops you borrowing to pay interest — which is the most expensive money in the whole arrangement.
Is prepaying an education loan free?
Generally yes — these loans are usually free to prepay, which makes putting early career income against the balance unusually effective.
Rate bands and lending rules on this page were last reviewed on 2026-10-23 and are indicative, not offers. The arithmetic is produced by the same code the calculator runs. Confirm the terms with your own lender before committing; nothing here is financial advice.